• OSTK reported EPS of $0.68 compared with estimates for $0.36.
  • Overstock.com investment tZero received a strategic investment from Intercontinental Exchange.
  • Net revenue was down 9% YoY and under consensus.

Overstock.com (OSTK) has jumped more than 25% to $45.70 in Wednesday's premarket after reporting a resounding beat on earnings per share (EPS). Wall Street had expected EPS of $0.36, but OSTK reported $0.68 – nearly double.

Overstock.com Stock News: Beat on EPS, bad on revenue

The ecommerce site that primarily sells furniture, home goods and clothing reported $613 million in revenue for the quarter, well short of the $644 million average estimate from analysts. This figure was also 9% off the same quarter one year ago.

The market seems to have disregarded this whiff and instead focused on clearing house InterContinental Exchange's investment in tZero. The latter is a blockchain platform focused on trading digital securities of which Overstock.com owns 80%. OSTK's myriad investments in blockchain technology have made it a popular retail stock for those trying to gain exposure to the cryptocurrency space.

"The foundational operational improvements we have made over the past two years have stabilized the business and positioned us well to navigate through economic and industry-specific cycles over the long term," said CEO Jonathan Johnson. "We are proving we can adjust to, execute through, and take advantage of both positive and negative jolts in the market."

OSTK key statistics

Market Cap $1.6 billion
Price/Earnings 16
Price/Sales 0.6
Price/Book 2.4
Enterprise Value $1.3 billion
Operating Margin 3%
Profit Margin


52-week high $111.28
52-week low $35.67
Short Interest 16%
Average Wall Street Rating and Price Target Buy, $108

Overstock.com Stock Forecast: Reversal is underway

While OSTK shares are rebounding marvelously on the earnings call, shares have been down more than 38% year to date. This means that a one-day rebound is not saying much. On the daily chart OSTK needs to retake $48.50 and $54.34 to make this bull run a long-term phenomenon. $48.50 is support from late 2020 that may turn into resistance. $54.34 is the recent high from February 9. The 50-day and 20-day moving averages are both near these resistance levels and add to their significance.

One piece of evidence that this may be a true reversal is that there is a price divergence with the Relative Strength Index (RSI). Between January 21 and February 22, a one-month period, the RSI drifted up from 17 to 31. This is an oversold reading to be sure, but the upward trajectory of the reading diverges with OSTK's price over that same period. The OSTK price dropped over that period from $40.86 to $36.45. RSI divergence often signal long-term reversals in share price are imminent.

OSTK 1-day chart




Like this article? Help us with some feedback by answering this survey:

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content

Recommended content

Editors’ Picks

AUD/USD losing bullish steam as concerns weigh

AUD/USD losing bullish steam as concerns weigh

Wall Street trimmed its recent gains and approaches weekly lows, reflecting persistent market fears. AUD/USD turned south and risks additional slides as China is set to unveil growth-related figures.


EUR/USD corrective advance extends towards 0.9800

EUR/USD corrective advance extends towards 0.9800

The EUR/USD pair advanced for a second consecutive day, now trading a handful of pips below the next big figure. With no real reasons to buy the EUR, the movement seems more related to profit-taking.


Gold consolidating weekly gains amid broad dollar’s weakness

Gold consolidating weekly gains amid broad dollar’s weakness

XAUUSD trades around $1,660, pressuring the weekly high. The metal fell to an intraday low of $1,641.46 but resumed its advance as investors keep moving away from the safe-haven currency. The market´s mood is far from optimistic. 

Gold News

Bitcoin price ruptures $19,000 support oblivious to ballooning BTC/GBP’s trading volume

Bitcoin price ruptures $19,000 support oblivious to ballooning BTC/GBP’s trading volume

BTC appears to be playing games with investors in move that see price action repeatedly undermined. Earlier in the week, the flagship cryptocurrency jumped to $20,200 but immediately snapped out of the northbound move to test support at $18,500.

Read more

US August PCE Inflation Preview: Will it trigger a dollar correction? Premium

US August PCE Inflation Preview: Will it trigger a dollar correction?

The US Bureau of Economic Analysis will release the Personal Consumption Expenditures (PCE) Price Index data, the US Federal Reserve’s preferred gauge of inflation, for August on Friday, September 30.

Read more